The Housing, Communities and Local Government Select Committee recently published its conclusions on the issue of leasehold reform. They rightly recommended that the Government stop the really nasty practice by some home builders of charging ground rents which appear innocuous to inexperienced buyers, but which double over ten or 15 years, this causing real distress to their owners.

This has 60 acres of once seedy central London, which was created by strip bar and porn king Paul Raymond. He died in 2008 leaving a fortune worth £650 million.

Soho Estates has hugely enriched itself as the once sleazy and bohemian area becomes increasingly corporate and dull.

Steve Norris talked down commonhold on the Conservative Home website:

His observations included:

“What happens in practice is that the commonholders invariably do go to a professionally-qualified managing agent to take on all these responsibilities – and thus are to all intents and purposes in exactly the same position as leaseholders. The managing agent has no interest in how the tenants afford their bills. The tenants have little exposure to how the agent determines who gets the work and at what price. In the worst cases, this itself is a practice prone to abuse.

“The fact is that the answer is neither leasehold or commonhold (which is, incidentally, available now but seldom used because, one can only assume, ordinary occupiers see the risks that elude the great minds of the Law Commission and the Select Committee).

“Instead, it is quite simple – namely, to ensure that occupiers get appropriate, decent service from suitably qualified professionals who will be in a contractual relationship that will ensure they deliver best value for money.”

The article prompted a number of negative and no positive comments.

One asked whether the article was written by “Tchenguiz’s PR man”.

Actually, keeping a long-term hold on residential property is of some significance to Soho Estates. Extremely expensive central London flats have been built in Soho and Fitzrovia.

Martin Boyd, LKP chair, was not impressed. He commented on the Conservative Home website:

Quite one of the least informed articles I’ve read in a long time.

Steve Norris fails to mention the Conservatives almost got a commonhold bill through parliament in the 1990’s when they had understood it to be a much better form of tenure. At the time, the bill never reached final reading to to a few issues with Europe and an election.

What is reproduced in this article is little more than the freehold investors’ argument for making a lot of money out of other people’s homes.

Many of these supposed ‘long-term custodians’ happen to be companies formed in the last 20 years which happen to operate from offshore territories.

The argument about people not wanting to get involved in their building and just wanting to come home to a nice quiet life sounds idilic but the real world is not like that. Quite often exactly the opposite happens in the leasehold world when the landlord overcharges or fails to look after the building as almost everyone living in a cladding block is finding out at the moment.

Commonhold was a better system in the 1990s and it is now which is why almost the whole of the rest of the world uses it. For most people in most commonhold sites they have little involvement most of the time. Steve Norris’s proposition sets up an entirely false dichotomy.

For most sites, there is less to do in being in charge of the building than there is in running a residents association. You employ professional managing agents to do that for you in almost all buildings of any size.

In the leasehold world you do it as a landlord to make a profit with no real interest in the building until the end of what may be a 999 year lease. In the commonhold world you do it for the benefit of the building and the residents with no imperative to make any additional profit from yourselves.

Regulation of agents is long overdue it is a pity Grant Shapps and different Housing Ministers since have taken a long time to be persuaded.

HOW many lives does Steve Norris have? Most politicians would have been laid low by the revelation that they had had five mistresses; others would have been destroyed if – as a chauffeur-driven transport minister – they dismissed tube travellers as horrible, smelly people.

Contact LKP

The leasehold game is weighted against ordinary home-owning leaseholders, who aren’t professional players. LKP was set up to redress the balance, to help you win your disputes or at least avoid disasters.

If you have a leasehold problem, you can email sok@leaseholdknowledge or take a chance on calling 07808 328 230.

News archive

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… and now we are “working with” the CMA inquiry (or, rather, being investigated by it, as others might put it) Countryside Properties plc has responded to leaseholders who wrote in last week demanding the freeholds to their homes. Here is the PR-crafted response. But to save you the effort, it could be precis-ed like […]

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By Sebastian O’Kelly Has South Somerset council twigged that it can make a fortune out of residents in private estates by playing the ‘fleecehold’ game? It has set up a company called Elleston for “landscaping and horticultural work” which it hopes will make £2.2 million a year in two year’s time. Thousands of private estates […]

Barratt has insisted on the evacuation of the Citiscape tower block which has Grenfell cladding. It is understood that engineers for the developer have found flaws in structural piers at site, and that residents are being rehoused immediately. It is anticipated that most residents in the 100 flats will only be evacuated for a few […]

Last week Redrow revealed a sixth consecutive year of bumper profits. It sold 6,443 homes, posted a 7% rise in pre-tax profits to £406m and announced that sales were up 10% to £2.1bn. But 40% of those profits come from the taxpayer subsidy of Help To Buy, and The Times was unhappy with build quality […]

The Daily Mail has tried to smear shadow chancellor John McDonnell over his modest Norfolk holiday chalet, worth £170,000, which is leasehold. The only public interest argument for this article was that John McDonnell “was accused of hypocrisy over his plans to clamp down on buy to let landlords after it was revealed that he […]

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More than 700 emails jammed the mailboxes of house builder chief executives this week as leasehold house owners demanded the freeholds to their homes. The protest came after Persimmon caved in to a trading standards action in Cardiff last month. Leasehold house buyers at the St Edeyrn’s Village development in Cardiff claimed Persimmon sales staff […]

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By Michael Epstein (who has been critical of FirstPort in the past) Firstport the controversial property management company, have recently negotiated a major re-financing package with Lucid Trustee Services and investors Equistone. This follows the failure by Firstport’s previous investors to sell the company and their subsequent decision to withdraw from their involvement with Firstport. […]

Evidence based on sales since 2010 Evidence includes unverifiable discounts – ‘incentives’ – from the retirement developers LKP refused to be associated with the report and urged non-publication In spite of abundant evidence on the Land Registry of catastrophic falls in value of retirement properties, today (August 20 2019) the Elderly Accommodation Counsel reports that […]

A family selling a McCarthy and Stone retirement flat with a rip-off lease condition have been saved £25,000 after the case was taken up by LKP. Rita May Bailey, who is now deceased, bought the one-bedroom flat at Bridewell Court, in Widnes, Cheshire in February 2008, which has a registered price of £167,450. Mrs Bailey, […]

By Sebastian O’Kelly The estate of Nigel Wilkins, the leasehold activist who died after a brief illness in February 2017 aged 66, has left £10,000 to the Leasehold Knowledge Partnership. LKP sincerely thanks the executors and Nigel’s family for making this donation and we will ensure that it is put to good use. For years […]

Bottomley and Fitzpatrick defend LKP in Commons and insist on co-operation with Leasehold Advisory Service Commons debate, July 11 2019 By Sebastian O’Kelly Some of the contributions to the Commons leasehold debate on July 11 of both Sir Peter Bottomley and Jim Fitzpatrick would have been lost on almost everyone in the chamber, but not […]

The prime minister, Boris Johnson, spoke in support of leaseholders at his first prime minister’s questions earlier this week. In reply to a question by Sir Peter Bottomley he said that he was fully aware of the “injustices that leaseholders are facing”. He congratulated Sir Peter Bottomley for the campaign that he has been running […]

As for £32,000 for painting flats corridors, they could have been painted in “gold” … Commons debate, July 11 2019 Investors in the freeholds of ordinary families’ homes knew the political risks of these speculations, Labour’s shadow City minister Jonathan Reynolds told the Commons. The implication of this is … they can take the consequences […]

By Harry Scoffin The former health and safety commissioner tasked to investigate building standards following the Grenfell Tower fire has criticised government for allowing it “to take so long” to agree her blueprint for maintaining the integrity of high-rise residential blocks. In comments to the Communities Select Committee on Monday, Dame Judith Hackitt also raised […]